Latest China anti-corruption rules have familial ring

When Zhou Yongkang, the Chinese Communist Party security chief who had a shadow grip on the country’s oil industry was probed last year, it was discovered that his son had a thriving business selling equipment to service stations and state-owned oil fields across China. His son’s mother-in-law had amassed stakes in pipelines and natural gas facilities from Sichuan to Hainan island, while his sister-in-law had assembled sprawling interests in mines, property and energy.

Zhou was just tip of many such icebergs and eradicating them in a nation the size of China is no easy task. President Xi Jinping wants to start small.

Shanghai’s city government, at Xi’s behest, said announced Monday that it’s issuing rules to restrain the families of senior city officials from running private businesses. It’s described as a pilot measure that if successful, will eventually go nationwide in the Chinese president’s sweeping campaign against corruption.

Reuters reported that Xi gave his blessing to the new rules in March, “requiring that Shanghai run the pilot and lead from the front.”

Xi’s anti-corruption drive’s been criticized in the West as a veiled attempt to silence political opponents and consolidate his leadership. It’s also blamed for disrupting’s China economy and government through the removal and intimidation of thousands of civil servants. But while Xi may be killing two birds with stone, his campaign is also the boldest attempt yet to tackle a reigning source of corruption in China’s polity and economy.

The new rules imposed in Shanghai apply to officials at the level of deputy bureau director and above in government, the ruling Communist Party, the judiciary, the local parliament as well as state-owned enterprises.

The spouses and children of top officials in Shanghai can’t register individual businesses or partnerships. Nor can they invest in non-listed enterprises or register a business overseas and do business back in China, according to Reuters.

The spouses of senior officials are also prohibited from occupying top positions in private companies or holding top-ranking posts in foreign-invested companies.

Another curb: Children and the children’s spouses may go into business, but they must avoid doing so in the jurisdiction where the official works.

Asia Unhedged thinks it’s a formidable challenge to enforce such rules in Shanghai — let alone the rest of China. But Xi clearly wants to send a message. He doesn’t intend to get everybody. It’s part of a time-honored strategy in Chinese statecraft which involves “killing the chicken to scare the monkey.”